MPF returns fall short of inflation, says report

10 June 2014   Category: News, Asia, Global, Hong Kong   By Hui Ching-hoo

Hong Kong’s Mandatory Provident Fund (MPF) pensions system has failed to offer sufficient inflation protection for its members this year, with products delivering a measly return of 0.88% on average for the first five months of 2014.

In comparison, the territory’s Consumer Price Index (CPI) rose by 3.7% year-on-year in April. 

According to a report from fund consultancy Lipper, equity sector pharmacy and health funds have been the best performers for the year-to-date, securing a return of 7.52%. These were trailed by European and Asia-Pacific ex-Japan equity funds, which recorded returns of 4.33% and 3.94%, respectively.  

Meanwhile, Hong Kong, China, Japan, Greater China, and Asia-Pacific equity funds, along with global bond and Hong Kong-dollar money market funds were the biggest underachievers among the 24 fund types, with negative investment returns during the period.

In terms of individual product performance, the Manulife Global Select MPF Healthcare Fund topped its peers by delivering a year-to-date return of 7.52%.